According to reports, two major Indian cryptocurrency exchanges have halted deposits using a popular payment method, prompting concern in a country where, despite Bitcoin’s great popularity, regulatory clarity is still absent.

According to news reports, Indian crypto exchanges WazirX and CoinSwitch Kuber have disabled rupee deposits for the purpose of purchasing cryptocurrency using the United Payment Interface (UPI).

In India, UPI is a widely utilized real-time payment system governed by the central bank. In the previous fiscal year, the total value of UPI transactions exceeded $1 trillion. Concerned consumers can continue to withdraw funds through the interface, according to the two exchanges.

Fears of Financial Instability

Despite the fact that India, the world’s second-most populous country, has spent years developing legislation regulating cryptocurrencies, with a measure endorsed by the central bank due to concerns about financial stability risks, authorities have recently decided to tax cryptocurrency income, indicating their approval.

According to CoinGecko, the top three Indian crypto exchanges conducted $140 million worth of trading in the last 24 hours.

Last Monday, the National Payments Corporation of India, the operator of the government-backed UPI system that facilitates bank transfers, issued a one-line statement claiming that it had no knowledge of its use by any cryptocurrency exchange.

Cryptocurrency investors in India are on the rise

Digital currency is immensely popular in India. Over the last year, cryptocurrency investments in India have grown in popularity, resulting in a multibillion-dollar sector. Cryptocurrency is owned by 15 to 20 million people in the country.

However, there is a lack of statutory clarity in the country: Though parliament passed a 30% tax on revenues from digital assets in February, India’s central bank had previously considered outlawing bitcoin.

On Twitter, investors expressed their dissatisfaction with the exchange because it did not accept payment gateways from the majority of large banks, including ICICI Bank and HDFC Bank.

CoinDCX, a prominent cryptocurrency exchange with over 10 million users, permitted only bank transfers and had a minimum deposit of 3,000 dollars.

CoinSwitch, which claims to have over 15 million users, did not respond to a request for comment from Reuters right away. Furthermore, the NPCI did not respond.